Tag: Employment

Since the biggest tech giants came onto the scene, Silicon Valley has seen a tension between the companies and labor unions due to an arguable lack of employee representation.[1] While there are numerous hypotheses for why unions have been unable to infiltrate the tech sphere, one of the most compelling explanations has been the simply technology-averse attitude of unions. However, on March 12, 2015, Facebook agreed to a contract proposed by Teamsters Local 853 on behalf of shuttle bus drivers.[2] The agreement could signal a major change in the landscape of employer-employee relations in the technology sector.

II. Background

A. Overview: The Changing Landscape of Employer-Employee Relations

The general employer-employee dynamic is in flux due in large part to the Obama administration. Recently, the White House proposed a rule modifying the Employee Retirement Income Security Act (ERISA) of 1974, designed to “crack down on irresponsible behavior in today’s market for financial advice by better aligning the rules between employer-based retirement savings plans and IRAs.”[3] In 2009, the Employee Free Choice Act was introduced into both chambers of the U.S. Congress[4] in order to remove the present right of the employer to demand an additional, separate ballot when more than half of employees have already given their signature supporting the union.[5] Many companies have expressed serious apprehension about the possible implications of these changes. The Teamsters union has been seeking to organize many of these companies, such as FedEx and Facebook, and the changes would make it easier for them to do so. In response, these companies have threatened to scale back drastically in order to compensate for potential losses.[6]

B. Uber & Lyft

For quite some time, tech companies and labor unions have clashed.[7] Until recently, none of the major tech companies had unionized employees.[8] Much of the tension between tech companies and unions is derived from what can be construed as an adversity to technology on the part of unions.[9] Companies like Uber and Lyft, which use mobile applications to connect passengers and cab drivers, have been under siege due to labor disputes.[10] Currently, two lawsuits brought forth by drivers of the companies are seeking reclassification so that they are protected as employees as opposed to independent contractors.[11] Earlier this year, the judges overseeing these matters decided that the cases would have to be decided by juries following Uber and Lyft unsuccessfully arguing that their drivers are independent contractors.[12] If the drivers succeed in the courts, Uber and Lyft may have to change their business models entirely.

Generally, startups are able to develop more affordably and with less bureaucratic resistance when they are free to hire and maintain independent contractors. When Uber and Lyft developed, they did so relying on and budgeting for independent contractors.[13] Classified as employees, the drivers will be far more expensive to maintain, thus likely cutting largely into the companies’ revenue streams. Employers “must withhold income taxes, withhold and pay Social Security and Medicare taxes, and pay unemployment tax on wage-paid” full-time employees.[14] Further, employees would be able to organize formally. As of 2014, Southern California Uber drivers have unofficially aligned with a local Teamsters union.[15]

C. Tech Companies and Immigration Reform

Tech companies and startups alike rely not only on independent contractors, but on foreign labor as well. The issue with outsourcing is one that continues to be at the forefront of political discourse.[16] Still, tech companies value high-skilled foreign labor, especially foreign engineers, whom the tech industry has continually fought to make it easier to hire.[17] Expectedly, unions have aggressively spoken out against such efforts. In 2013, a legislative representative for the American Federation of Labor and Congress of Industrial Organizations (AFL-CIO) stated, “The tech industry is, frankly, being greedy. They are … blatantly trying to roll back requirements that give high-skilled American workers a fair shot at getting a job.”[18]

Recently, the Obama administration announced a new rule that would allow work permits to be provided to qualified spouses of highly skilled immigrants who are in the United States on temporary visas.[19] This rule has been sought out by tech companies and other businesses in general.[20] The change will primarily affect temporary workers from India and China and represents an effort both to help create jobs and to reform what has been widely acknowledged as a dysfunctional immigration system.[21]

D. Opening the Gates to Unions

In November of 2014, shuttle bus drivers under the employ of Facebook joined with the Teamsters Local 853.[22] The alignment came amidst the drivers’ complaints of being underpaid, overworked, and unfairly compensated for time on the job.[23] In February, the two entities formulated a union contract that was unanimously agreed upon prior to proposal.[24] In March, Facebook accepted the terms, which included an increase in average pay “from $18 an hour to $24.50 an hour.”[25] Other benefits include “11 paid holidays, up to five weeks of paid vacation, paid bereavement leave, paid health care for full-time workers and their families, guaranteed overtime and more.”[26] While Facebook has set an example, it is not the only major tech company implementing improved working conditions for its employees. Apple and Google will also be providing increased hourly pay and benefits to its shuttle drivers.[27] Compass Transportation employees who shuttle Apple, Yahoo, eBay, Zynga, Genentech, and Amtrak have unionized recently.[28]

III. Analysis

Perhaps the shifting labor and employment landscape in Silicon Valley is indicative of a future wherein unions play a larger role in tech companies’ affairs; however, questions remain as to whether labor unions would be a good idea for developed startups and who is likely to be unionized within these startups. As of now, drivers have been successful in either pushing forth important lawsuits, as in Uber and Lyft’s cases, or they have executed union contracts, as with Facebook. Whether engineers, for example, will be successful in yielding similar achievements or whether they even want to do so is uncertain.

Labor unions are typically brought in to assist in improving working conditions for laborers, but startup companies are generally known for taking great care of their employees. Google and Facebook both made Forbes’ “20 Best Places to Work in 2015” list and it is no wonder.[29] These companies not only innovate the products of tomorrow, but they also have a hand in innovating the work environment.[30] They are able to recruit attractive talent through “[c]ushy salaries, luxurious dining amenities, and decentralized management structures.”[31]

Even for less elite and renowned companies, labor unions could harm a natural flow that exists within the tech industry. Specifically, there has been a longstanding reliance on freelance-type workers, especially in the development process.[32] While this preference may signal a potentially exploitative nature on the management side of relations, it is one that has been beneficial to laborers as well. As the tension between unions and tech companies began to crystalize as far back as 2001, Alvin Bost, a freelance web designer, told CNET that he thought “unionization would ruin the free spirit and innovation in the high-tech industry,” and went on further to note that it would be terrible for people like him.[33] Designers, engineers, and other contract workers enjoy a level of agency that allows them, as the term “freelance” itself suggests, to move freely from company to company, thus emphasizing an important and characterizing feature of the industry: choice. Tim Colson, a software engineer, noted of working conditions that “about the only detriment [can be] the long hours” but laborers are usually “compensated in some way for the effort,” and “if a particular environment isn’t acceptable, you can simply move on.”[34] An employment attorney in Palo Alto, Victor Schachter, said over a decade ago that “employees are going to be very reluctant (to organize) when they see the obligation of dues and the possibility of strikes and the realities of what collective bargaining is … in the end, very few, if any, of these companies will find that they have union-represented employees.”[35] To this day, his prediction seems to hold true.

On the other hand, labor unions may be able to find a foothold with service-level workers, such as janitorial staff, who are not able to share in the wealth, prosperity, and growth of the tech industry[36] and expand from there. As of now, there is evidence to suggest that booms in the industry benefit engineers and investors primarily, with very little trickling down to workers not at the top of the wage pyramid.[37] Drivers, for example, seek collective bargaining for the purpose of keeping up with the rising cost of living in the Bay Area.[38] One of Facebook’s shuttle bus drivers, Jimmy Maerina, illustrated this when he stated that he is happy to be able to live where he wants and to also “be able to put some food on the table.”[39]

IV. Conclusion

The tech industry as a whole presents a very unique platform for labor and employment relations. This platform has paved the way for various innovations from work environment modernization to comprehensive immigration policy reform. Still, what makes the industry particularly unique is its relationship—or lack thereof—with labor unions. For decades, Silicon Valley has thrived with minimal union influence. However, as the labor and employment field continues to make notable shifts, unions may be able to reformulate their tactics and develop an effective strategy for gaining a foothold in the industry through service employees. The need for companies to provide for and maintain their service workers is acknowledged by both the workers, like drivers for Uber, Lyft, and Facebook, and management, like Facebook, Google, and Amazon. With a greater occupation within the tech sphere, unions may be able to expand their influence, thus potentially changing not only the procedural characteristics of the industry, but perhaps entire business models as well.

*J.D., University of Illinois College of Law, expected 2017. B.A., English and Political Science, University of Massachusetts-Amherst, 2012. I would like to thank the board of the Journal of Law, Technology, and Policy for giving me the opportunity to contribute this piece. Special thanks are given to Andrew Lewis and Iman Naim for all of their advice that went into writing this piece. I also would like to thank my mentors for their ongoing and invaluable guidance: Allison Maue and Professor Paul Healey. Finally, a huge thank you always to my parents, Chrissalee and Lesly, and my sister, Victoria, for their constant encouragement.

[10] Maya Kosoff, How Two Lawsuits Could Destroy Uber and Lyft’s Business Models – and Set a Precedent for the Rest of the Sharing Economy, BUS. INSIDER (Mar. 12, 2015, 10:12 AM), http://www.businessinsider.com/uber-lyft-business-models-and-lawsuits-2015-3.

“Once a new technology rolls over you, if you’re not part of the steamroller, you’re part of the road.”[1] In this case, Radio Frequency Identification Technology (RFID) is the steamroller, and companies who choose not to adopt this technology are roads. RFID is a technological advancement that utilizes radio waves to identify objects and people.[2] Once a RFID tag is near a RFID reader, the tag sends electromagnetic waves to a computer that then become stored as digital data.[3] Although RFID has been around for over sixty years, it has recently expanded.

II. RFID in Modern Society

Consumers encounter RFID in various forms ranging from toll passes stationed inside their vehicles to microchips implanted in their pets.[4] Even the Vatican imbeds the chips in identification badges to keep track of clergy and staff with the goal of maintaining the security of private files.[5] While certainly a valuable and even necessary technology, its expansion has triggered reluctance. Just over a year ago, a Texas school district was sued after district officials implemented a pilot program using RFID technology to monitor students’ whereabouts on school property in hopes of enhancing safety.[6] However, privacy-related concerns do not appear to be impeding the anticipated growth of RFID. The RFID market is expected to triple between 2013 and 2020, from just under $8 billion to more than $23 billion.[7] RFID is primarily used for inventory management and in corporate supply chains, but in recent years it has gained momentum as an employee tracking technology.

III. RFID as an Employee Tracking Technology

Humans are a corporation’s most valuable resource, and effective management of its resources is of utmost importance to decreasing waste while increasing output. Thus, companies have begun implementing ways to track employees using RFID. RFID is a useful tool for many businesses because the chips improve accuracy, efficiency, and productivity.[8] For example, Bank of America asked ninety workers to wear chipped badges, which recorded their movements and the tone of their conversations.[9] The data collected demonstrated that the most productive workers were part of close-knit teams. Implementing the results, Bank of America scheduled group breaks that overrode previous individual breaks and increased workplace productivity by ten percent.

A quick Google search will display dozens of companies that are eager to sell their latest RFID employee tracking products. One such company, Intelleflex,advertises the sale of RFID badges that track employees and reveal to employers detailed information about their workers such as an employee’s name, location history, photograph, and biometric information.[10] Perhaps the most intrusive example of RFID use is the human implantation of a microchip. In 2006, concerns about invasive business practices gained attention after a company in Cincinnati, Ohio announced that it would inject RFID chips into the biceps of willing employees.[11] While implanting humans with RFID for work-related purposes is considered extreme, many companies have noticed the benefits of RFID technology.

IV. Where Is RFID Headed?

The inexpensive and discreet nature of RFID has led to a myriad of ways private employers can use RFID technology. RFID today is applied by businesses with the goal of increasing workplace efficiency through the maintenance of employee attendance records, calculation of overtime, and reduction of tardiness among others.[12] As RFID usage becomes more commonplace, there is much room for discussion regarding security issues, employees’ rights to privacy, and employers’ rights to workplace organization.

A. The “Magic” of Technology and the “Monster” of Profit Margins: Companies Adopt RFID in Global Business Models

Competition is a driving force in all intersections, and its effects are particularly apparent in the marketplace. This spring, Disney Parks will be introducing MyMagic+ wristbands that collect mounds of visitor personal data in an effort to better customize visitors’ experiences, market effectively to target audiences, and, of course, to increase sales.[13] Disney’s inevitable struggle with privacy concerns as they launch this innovative program will be exceptionally informative of the lenient or restrictive direction that the law will take. Despite the hurdles, “Disney has decided that MyMagic+ is essential.”[14] Thomas O. Staggs, chairman of Disney Parks and Resorts, recognizes the need for the company to “aggressively weave new technology into its parks—without damaging the sense of nostalgia on which the experience depends—or risk becoming irrelevant to future generations.”[15]

B. The Intersection of Individual Privacy and RFID Application

RFID technology itself does not threaten individual privacy; it is when implemented in invasive and opaque ways that problems arise. Recently, researchers observed RFID tracking sensors at a Boston hospital to monitor the activity of sixty-seven nurses.[16] The nurses wore chipped identification badges that measured nurse-to-nurse interactions, the physical activity of the nurses, and nurse-to-patient interactions. Sociometric Solutions, the company that conducted the study, claims that data analyzed through the tracking of these nurses showed strong relationships between nurses’ behaviors and patients’ overall hospital stay. Sociometric Solutions suggests that the data retrieved will allow the hospital to better plan their investments, leading to improvements to patient recovery and bottom-line cost reductions. Hospitals in the United States have also implemented RFID wristbands for their staff members. The wristbands monitor how well employees wash their hands and even send hand-washing hygiene report cards to the employees.[17] This technology will allow for companies to organize in ways that improve feedback, interactions, and the ways that individuals work.[18] RFID technology is extremely beneficial from a business perspective, and the law is struggling to keep up.

V. New Legislation Involving RFID Tracking

The utilization of location tracking tools within the workplace is unprecedented and tasks legislatures with the creation of laws.[19] So far, the most substantial case law was decided in 2012 in United States v. Jones. TheSupreme Court held that the government’s installation of a GPS device on a defendant’s vehicle with the purpose of monitoring the vehicle’s movements represented a “search” within the meaning of the Fourth Amendment.[20] The holding is quite narrow, as it only addresses the government’s use of GPS tracking when it constitutes a physical trespass. This raises questions regarding the nature and the scope of location tracking data within the private sector, leaving states to individually address privacy concerns.

In 2005, California was the first state to adopt legislation that addressed RFID and privacy-related concerns, but it was limited to the use of automated teller machines.[21] Today, six states prevent unauthorized “skimming” of RFID information.[22] Four states—Wisconsin, North Dakota, Oklahoma, and California—have taken measures to prevent employers from requiring employees to implant RFID chips in their bodies.[23] In July 2013, Montana made history as the first state to pass a law restricting state officials from tracking anyone using an electronic device.[24] In January 2014, an Illinois law disallowed state agencies from using electronic tracking devices on vehicles.[25]

In 2011, the New Hampshire House of Representatives proposed House Bill (HB445), which restricted electronic tracking of individuals. However, it provided an employer exception, allowing employers to track employees within the confines of an employment relationship during working hours.[26] HB445 passed in the New Hampshire House of Representatives, but it failed in the Senate. Last year, the New Hampshire House of Representatives tried again with a 2013 House Bill (HB592). HB592 provides even more leeway to employers than the original draft. The later draft expands on employers’ abilities to track their employees in any “work-related functions, during or after working hours, upon reasonable notice to the employee.”[27] This bill died in chambers, but New Hampshire’s efforts illustrate the struggle of legislatures to find a clear solution, leaving employers lacking clarity about limitations on their ability to track their employees. With the increasing use of RFID in the employment context, federal and state legislatures will need to construct guidelines and clarifications hastily.

VI. Recommendations

Employer efficacy, created through transparency and openness, will lead to workplace efficiency and an embrace of technology necessary to compete in the marketplace, rather than fear and rejection. Communication is crucial, particularly when implementing technology that is unfamiliar. In a case study conducted for RAND Infrastructure, Safety, and Environment, researchers monitored six private-sector companies, in an effort to understand these corporations’ policies for collecting, keeping, and using data obtained by RFID. Of the companies studied, only one had “[e]xplicit, written policies governing the use of RFID in the workplace. . . .”[28] All of the companies “ke[pt] the records indefinitely,” rather than adopting a “limited data retention policy. . . .”[29] Not a single company communicated to its employees that the data on their ID badges was being collected and stored. Employers should deal with legal uncertainties by explaining to employees the benefits that RFID provides to companies. Policies that clearly define the scope of an employer’s tracking ability on an employee are best to elicit informed consent. The idea of informed consent is consistent with fair, ethical information practices and clear guidelines communicating employer expectations. Informed consent will allow for employee rights that strike the right balance between individual privacy and workplace efficiency.

VII. Conclusion

The ever-increasing demands for corporations to exceed their bottom line while competing in a marketplace rapidly adapting to technological advances means that employers should, and in fact must, take advantage of RFID technology in order to merely keep up. However, the law is unable to match the demands of the market and the advances of technology. RFID utilization requires a legal remedy. This technology is being applied to human beings with rights to privacy and non-discrimination. Corporations ought to be allowed to take advantage of research efforts and maximize workplace efficiency. However, both parties are entitled to a legal framework setting clear guidelines within which they can operate. Informed consent is a prerequisite to medical treatment and should necessarily be extended to the employer-employee workplace context.

*J.D. Candidate, University of Illinois College of Law, expected 2016. B.A. Sociology, B.A. Communication, summa cum laude, University of Illinois at Urbana-Champaign, 2013. I thank the editors of the Journal of Law, Technology, and Policy for their time and guidance in the creation of this piece.

**J.D. Candidate, University of Illinois College of Law, expected 2016. B.A. History, B.A. Speech Communication, University of Illinois at Urbana-Champaign, 2007. I would like to thank the editors for their time and attention to this piece.

[1] Sherry Kubanyi, New Technology Series: Be Part of the Steamroller—Not Part of the Road, Legaco Express, http://www.legaco.org/blog/new-technology-series-paralegal (last visited Apr. 6, 2014).